Carol Miller v Irwin Mitchell LLP
| Jurisdiction | England & Wales |
| Judge | Lady Justice Andrews,Lady Justice Falk,Lord Justice Phillips |
| Judgment Date | 01 February 2024 |
| Neutral Citation | [2024] EWCA Civ 53 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: CA-2022-001731 |
[2024] EWCA Civ 53
Lord Justice Phillips
Lady Justice Andrews
and
Lady Justice Falk
Case No: CA-2022-001731
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS IN LIVERPOOL
BUSINESS LIST (CHANCERY DIVISION)
His Honour Judge Cadwallader (sitting as a Judge of the High Court)
Case No BL-2020-LIV-000020
Royal Courts of Justice
Strand, London, WC2A 2LL
Robert Weir KC, William Thorpe and Thomas Westwell (instructed by Bond Turner) for the Appellant
Andrew Warnock KC and Andrew Spencer (instructed by Kennedys) for the Respondent
Hearing date: 23 January 2024
Approved Judgment
This judgment was handed down remotely at 10.30am on 1 st February 2024 by circulation to the parties or their representatives by e-mail and by release to the National Archives.
INTRODUCTION
This is an appeal, brought with the permission of the Judge, against the order of HH Judge Cadwallader dated 27 July 2022, dismissing the Appellant's claim for damages for professional negligence against her former solicitors. The order was made following a trial of preliminary issues in the Business List at Liverpool. The Appellant, Mrs Miller, contends that the Judge erred in his determination of some of those issues, and consequently was wrong to dismiss her claim. The Respondent, Irwin Mitchell, contends that the Judge was right for the reasons that he gave. It has also served a Respondent's Notice seeking to uphold the Judge's order on different or additional grounds.
This is a sad case. On 13 May 2014 whilst on holiday with her husband in Turkey, Mrs Miller slipped and fell as she was going down some stairs in their hotel. She broke her leg badly, suffering an open fracture. She underwent emergency surgery in Turkey in the early hours of the morning, but following her return to England an infection developed. After many further medical interventions, this ultimately led to her undergoing an amputation of her lower leg in November 2015.
Mrs Miller retained Irwin Mitchell to advise and represent her in connection with a claim against the travel operator, Lowcostholidays Spain SLU (“Lowcost”). The date of the inception of the retainer was disputed. The Judge held that an implied retainer arose on or around 25 January 2016 when Irwin Mitchell informed Mrs Miller that it was ready to proceed with her claim, and sent her a conditional fee agreement to sign (though she did not sign that document until July 2016). He found that by that date, Mrs Miller had communicated her decision to instruct Irwin Mitchell, and Irwin Mitchell had communicated its willingness to accept those instructions, subject to funding.
Irwin Mitchell sent a letter of claim to Lowcost on 22 February 2016 requesting that it notify its insurers immediately. Lowcost sent a copy of that letter to its insurers, HCC International Insurance Company Plc (“HCC”) on 3 March 2016, a little more than 21 months after the accident occurred. On 8 March, HCC responded to Irwin Mitchell, reserving its position. On 11 March, solicitors named Plexus Law wrote to Irwin Mitchell to confirm that they were instructed to act on behalf of Lowcost in respect of the claim.
On 28 April 2016, HCC wrote to Lowcost declining cover for the claim on the basis that Lowcost had failed to comply with the notification provisions in the policy of insurance. Lowcost went into administration in July 2016. Plexus Law informed Irwin Mitchell of these developments by email on 21 July 2016, and provided further details in a letter dated 23 August 2016. Irwin Mitchell sought advice from counsel, following which they concluded there was no prospect of recovery from HCC under the Third Party (Rights Against Insurers) Act 1930. That was the statute governing the circumstances in which a claim could be brought against the insurers of an insolvent defendant at the relevant time (all the relevant events occurred before the Third Party (Rights Against Insurers) Act 2010 came into force on 1 August 2016). No complaint is (or could be) made about that conclusion.
Faced with the deeply unpalatable consequence that, even if her claim for damages for personal injury succeeded, she had no prospect of receiving payment, Mrs Miller brought proceedings against Irwin Mitchell. Her primary case in the court below was that she had entered into an express retainer with Irwin Mitchell on 19 May 2014, when she had a telephone conversation with one of the operatives of its “Legal Helpline”. Alternatively, a retainer should be implied from the conduct of the parties. Further or in the further alternative, Irwin Mitchell had assumed a common law responsibility to Mrs Miller in tort.
Mrs Miller claimed that during the conversation on 19 May 2014, Irwin Mitchell should have advised her to notify Lowcost of the accident immediately. Alternatively, they should have given her that advice on 8 April 2015 when they received documents relating to her claim (which they had been pressing her for months to provide). Alternatively, Irwin Mitchell should have taken steps to notify Lowcost themselves. She contended that if she had been given such advice, she would have followed it, and if she had done so, or if Irwin Mitchell had notified Lowcost of the accident sooner than they did, Lowcost's insurance policy would have responded to the claim. (Before us, she put the case on the basis that there was a real, rather than a speculative or fanciful chance, that she would have recovered something from HCC. That was the subject of a supplementary skeleton argument.)
The Judge held that:
(1) No express or implied retainer was created when Mrs Miller contended, and that the true nature of the relationship was that Mrs Miller was only a potential client of Irwin Mitchell until 25 January 2016.
(2) No duty of care equivalent to that arising under a contractual retainer was owed to her until then.
(3) There was no duty on Irwin Mitchell to advise Mrs Miller to notify Lowcost of the accident, or to directly remind Lowcost to notify its insurer, at any time prior to sending the letter of claim on 22 February 2016.
(4) If Mrs Miller had been advised to notify Lowcost of the claim on 19 May 2014 she would have done so. Lowcost would then have notified HCC timeously in compliance with its obligations under the insurance policy and there would have been a 100% chance that the policy would have responded to the claim.
(5) However, if the notification of the claim had happened on or after 8 April 2015, HCC would still have declined cover on the basis of late notification. He assessed the prospects that the policy would have responded at any time from and after 8 April 2015 at zero.
The Judge's finding that there was a 100% chance that Lowcost's insurance policy would have responded if HCC had been notified of the claim by either party immediately after the call between Mrs Miller and Irwin Mitchell on 19 May 2014, was expressly qualified by his finding on preliminary issue 7, which was an issue about the proper construction and effect of the annual aggregate excess clause in that policy. He found that Lowcost had not “paid and exhausted the Excess” as expressly required by General Condition 4 of the General Terms and Conditions. Moreover, it was not financially in a position to do so. Irrespective of the notice issue, therefore, HCC was not liable to indemnify Lowcost. The Judge held at [145] that it was:
“highly likely that at any given time HCC would have taken the point, attractive or otherwise, which was available to it; and that Lowcost would not have been in a position to or chosen to make payment.”
Mrs Miller raised four grounds of appeal, namely:
(1) The Judge ought to have found that Irwin Mitchell owed her a common law duty of care, or a contractual duty of care under an implied retainer, from 19 May 2014 onwards.
(2) The Judge ought to have found that Irwin Mitchell owed and breached an obligation from 19 May 2014 onwards to advise Mrs Miller to notify Lowcost, or alternatively to notify Lowcost themselves about her accident.
(3) The Judge erred in law in finding that the proper construction and effect of the excess clause within Lowcost's policy with HCC meant that there was no prospect of the policy responding at any relevant time after Lowcost's administration.
(4) The Judge erred in finding there was a 0% chance that Lowcost's policy would have responded had notice been given of Mrs Miller's accident to HCC from and after 8 April 2015.
In oral argument, on the primary issue of liability encompassed by Grounds 1 and 2, Mr Weir KC (who was not trial counsel) focused on a much narrower submission that on 19 May 2014 when Mrs Miller rang their “Legal Helpline”, Irwin Mitchell owed her a duty at common law to exercise reasonable care in and about the advice provided on that occasion. He contended that because their adviser, Ms Victoria Halliwell, chose to inform Mrs Miller that the limitation period for bringing a claim was 3 years, she was also under an obligation to advise Mrs Miller to notify the tour operator of the accident if she (Mrs Miller) had not already done so.
Mr Weir also made oral submissions on Ground 3, though in doing so, he spent little time in addressing the correct construction of the excess clause. He focused instead on the Judge's finding that it was “highly likely” that HCC would have refused to indemnify Lowcost, relying on that clause, even if it had been notified of the accident in or around May/June 2014. The main thrust of Mr Weir's submissions on this point turned on the case raised in the Appellant's Supplementary Skeleton Argument that, even if that finding were correct, there was nevertheless a real and substantial chance that HCC would...
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